An artist’s rendering of Treasure Valley Reload Center as originally designed. It is under construction near Nyssa and costing about $9.8 million more than the original $35 million budget.

NYSSA — Building the Treasure Valley Reload Center to original design specifications would cost almost one-third more than originally estimated, prompting proponents to scale back the project.

The truck-to-train loading facility to be built north of Nyssa would ship onions and other commodities east to major markets. Southeast Oregon and southwest Idaho produce about a quarter of the country’s fall storage onions.

The 2017 Legislature approved a $26 million ConnectOregon grant from lottery-backed bonds. Legislators this year approved a $3 million grant, from federal coronavirus recovery funds, to the city of Nyssa, for a water line extension for the reload center and future industrial development.

Greg Smith, Malheur County Economic Development director and officer of the separate Malheur County Development Corp., said the project is about $9.8 million more than the original $35 million budget. The original plan called for opening nearly 290 acres of industrially zoned ground for development.

He said an overarching solution is to reduce the budget and features “from a Cadillac to a Chevrolet” including eliminating “unnecessary wants.”

Cost overruns include about $5 million in unexpected necessary excavation to deal with excess groundwater, a price from lone building-construction bidder TCG Construction, Meridian, Idaho, that was about $2.9 million above expectations, and steel and asphalt costs driven by high inflation.

Smith said construction bidding interest has dropped due to development in southwest Idaho and high transportation costs. The corporation will solicit new bids.

About $3 million could be saved by delaying construction of one of the three rail spurs for three years, he said. And $1 million could be saved by using a septic waste system instead of a lagoon system serving several companies.

Smith said $2 million could be saved by eliminating all access roads except the one to the reload center. Industrial park roads could be added later as funding becomes available.

Substantial excess groundwater lies in the path of planned rail spurs. An engineering solution that uses riprap rock to displace water and add support strength is expected to reduce remediation cost by about $1 million, he said.

Another $300,000 could be saved by reducing office square footage.

“We don’t need $10 million, we need $3 million,” Smith said.

The development corporation is inquiring with legislators and state economic development unit Business Oregon about potential solutions.

Smith said potential funding sources are the Legislative Emergency Board, which meets between sessions, and the state Special Public Works Fund that provides low-cost financing to municipalities.

A Special Public Works loan would be repaid by Malheur County or Nyssa, depending on which applies. He said it would be backed by the development corporation, either through the 65 acres it has acquired or future sale of industrial park lots.

Malheur County Judge Dan Joyce, who heads the commission-like county court, said commissioners likely would be hesitant to borrow. The county at the outset did not plan to spend money on the project but ended up doing so to help the corporation purchase the site.

But the county supports the economic development project “and would like to see it come to fruition,” he said.

Nyssa City Manager Jim Maret could not be reached immediately.

Site work started in October, triggering state funding. Steel for the building is on-site. Smith said rail will be placed starting by late this month or in early May.

“Our goal is to ship onions by Oct. 1, and as of right now we are within that schedule,” he said.

A less expensive building is an option, though capacity to place and briefly store onions is important to handling efficiency, Smith said.

Reload Center features would be added as funding becomes available, he said.